Labour MP Frank Field has proposed a 10 per cent additional tax on high-earners, which could be wholly offset by individuals who give money to charity, in a bid to enrich civil society and redevelop a “giving culture”.
In his Allen Lane lecture today Field said people earning over £150,000 a year should be subject to the special tax because today’s super-rich were giving less to society, in terms of providing employment and donating to charities, than their counterparts 100 years ago.
He said generally the wealth of the super-rich of the Edwardian era was based in building up the country’s trade and commerce which resulted in a very significant increase in employment. This group of people also established foundations and directed considerable sums of money to advance charitable objectives.
But Field said: “Today’s super-rich, and there are notable exceptions, are neither employers of great numbers of people nor generous in charitable giving. The aim of this reform is not simply to change behaviour but to develop a new spirit and that spirit is for the new super-rich to fulfil their wider obligations to civil society.”
The proposed reform would raise £2.8bn which would ideally be given directly from individuals to charities or put in a Government endowment fund and distributed to bodies deemed most appropriate.
Field said the charity aspect of the proposal was “crucial” as he did not wish the idea to become part of the “stealth tax strategy”. He said: “The aim is not to increase Government income and the share of the national income spent by the Government. The opposite is the objective.”